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Thomas Bulkowski’s successful investment activities allowed him to retire at age 36. He is an internationally known author and trader with 30+ years of stock market experience and widely regarded as a leading expert on chart patterns. He may be reached at

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Chart Patterns: After the Buy
Getting Started in Chart Patterns, Second Edition book.
Trading Basics: Evolution of a Trader book.
Fundamental Analysis and Position Trading: Evolution of a Trader book.
Swing and Day Trading: Evolution of a Trader book.
Visual Guide to Chart Patterns book.
Encyclopedia of Chart Patterns 2nd Edition book.
Bulkowski's Blog: ThePatternSite.com
Class Elliott Wave Fundamentals Psychology Quiz Research Setups Software Tutorials More...
Busted
Patterns
Candles Chart
Patterns
Event
Patterns
Small Patterns
Market
Industrials (^DJI):
Transports (^DJT):
Utilities (^DJU):
Nasdaq (^IXIC):
S&P500 (^GSPC):
As of 11/21/2017
23,591 160.50 0.7%
9,615 92.77 1.0%
758 2.01 0.3%
6,862 71.77 1.1%
2,599 16.89 0.7%
YTD
19.4%
6.3%
14.9%
27.5%
16.1%
Tom's Targets    Overview: 11/14/2017
23,700 or 22,800 by 12/01/2017
9,300 or 9,800 by 12/01/2017
800 or 750 by 12/01/2017
7,000 or 6,500 by 12/01/2017
2,625 or 2,540 by 12/01/2017

Written by and copyright © 2005-2017 by Thomas N. Bulkowski. All rights reserved. Disclaimer: You alone are responsible for your investment decisions. See Privacy/Disclaimer for more information.

November 2017 Headlines


Archives


Thursday 11/22/17. 10-Year Forecast

Before I discuss the forecast, let me mention a few things.

I'll resume blogging on Monday evening. No, I'm not going anywhere. I just want to savor the holiday without having to worry about updating the website. I'll have to do some of that anyway (for the statistics), but not blogging saves time.

I'll be at home, working on building a jewelry box for my mom. I built a prototype and am refining it for the new version. She'll be 90 in three years, so I thought it would make a nice gift. I'll be delivering it as soon as I'm finished with it (taking advantage of the warm weather that's predicted: 70s) because she might not be alive in 3 years.

Although I can't recall her wearing or owning any jewelry, my dad was a carpenter/cabinet maker so she'll appreciate the woodworking. Well, that's the plan. I'll have to take out a mortgage to afford the shipping charges when I send it to her, so that's a bummer.

Chart Patterns: After the Buy

Speaking of money, with the holidays coming, remember to shop Amazon.com through my website. Just click on a picture of one of my books, like this one, pictured on the right.

It'll take you to Amazon.com with my referral code. When you buy anything during your visit, I receive a small referral fee which I use to support this website. You'll find the book pictures (links to Amazon) on the far left of each web page. All of my books are displayed there. Click one of the images. You'll be taken to Amazon where you can search for anything you wish (you don't have to buy the book. The link is an easy way to send the referral code to Amazon).

Bored? Read a book. If you want an entertaining good versus evil thriller, read Head's Law.

Need to check to see if you're still alive? For a book with an emotional ending, read, Bumper's Story

I wrote both books. See if I'm as good in writing fiction as I am in writing non-fiction.

Weekly Forecast

Picture of the weekly forecast

Now let's talk about the forecast. First, I show the weekly forecast for the next few years (as much as can fit on the chart).

It shows that the 2017 prediction of dropping prices after the October peak hasn't happened...yet. There's still time. Maybe we'll see that if or when the tax bill fails to pass congress.

The Dow is supposed to drop going into 2018 and then climb in the spring to a lower peak before heading down to the 2019 low. The predicted low is 16,440 as shown on the chart. From the current close of 23,500, that's a drop of 30%, which means a bear market is coming (any drop over 20% qualifies).

After the index bottoms in March 2019, the index begins a recovery. But for how long? The next chart shows the answer.

Monthly Forecast

Picture of the monthly forecast

This is the monthly forecast of the Dow industrials, looking ahead 10 years.

Notice that this predicted close is lower than that shown on the weekly chart. I've checked over the weekly code (software) I use to create the chart and believe it to be correct. I haven't looked into why the two lows are different. My guess is that on the weekly chart, a week's worth of prices might be missing (think 9-11 when the markets were closed for about a week. Rhetorical question: How do you adjust the prediction when the average has a missing value?).

Assuming it's correct, the chart shows the same dip going into 2019 followed by a recovery. There's another drop in 2021 but the Dow moves to new highs going forward. In 2026, the index reaches a high of almost 31,500.

You can refer to prior predictions to see how they turned out. Most of the time, they are off. Last year was the exception because it was almost dead on.

The links on that page also describe how this prediction isn't guesswork. It's all done using easy math.

-- Thomas Bulkowski

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Wednesday 11/22/17. A Look At Indicators

Picture of the chart pattern indicator

This is a picture of the chart pattern indicator on the daily scale. The indicator is the line chart below a chart of the S&P 500 composite.

Over the past two weeks or so, the indicator flipped to bearish (red vertical bar) and now it's bullish (green vertical bar). The thin blue indicator line at the bottom of the chart shows the indicator moving higher, probably hitting the ceiling now.

That's all good until you realize there's nowhere to go but down (for the CPI, that is).

Picture of the percent down indicators

The red line is the percentage of stocks at least 20% below their 1-year high (plotted upside down). The blue line is the average percentage drop of stocks below their 1-year high (plotted upside down).

Shown as a red line on the above chart...
On Monday, 23% of stocks in my database are in bear market territory (down at least 20% from their 1-year high).
A week ago, it was 25%.
The fewest was 14% on 12/09/2016.
And the most was 29% on 08/21/2017.
Shown as a blue line on the above chart...
The 496 stocks in my database are down an average of 13% from their yearly high.
A week ago, the average was 13%.
The peak was 9% on 12/09/2016.
And the bottom was 16% on 08/21/2017.

The red line, the more sensitive of the two, made a nice recovery over the past two weeks. It probably bottomed last week and moved up since then.

The blue line is unchanged from a week ago, according to the above numbers. But it sure looks like it rebounded.

The charts, taken together, suggest a continued move higher in the markets. That differs from the 1-year prediction which suggested we'd be headed toward a bear market by now. Go figure.

My guess is the hope for a corporate tax break is still powering the market higher.

-- Thomas Bulkowski

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Tuesday 11/21/17. Intraday Market Direction: Dow

The index climbed by 0.3% or 72.09 points. Since 10/01/1928 the index made 1078 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.7% on 597 occasions.
     Average loss was -0.7% on 481 occasions.
Expect the index to close higher 55.4% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 151/254 or 59.4% of the time.
     The prediction of the index closing lower has been right 32/65 or 49.2% of the time.

Since I post this the night before, check how the futures are trading before market open. Large moves can affect the opening direction.

Picture of the Dow industrials on the 5 minute scale.

$ $ $

I show a picture of the Dow industrials on the 5-minute scale.

An ascending and inverted scallop appears, shown here outlined in red. It's nicely shaped, if I may say so without being accused of any sexual impropriety.

Those types of scallops breakout upward, by definition. Otherwise, they'd be a rounded turn or just squiggles on the chart.

It's interesting how today's (Monday's) movement mirrors the scallop on Thursday. The Thursday pattern gapped up, so it's not an exact match. We'll see if Tuesday's trading takes price down a smidgen before a rebound.

$ $ $

The following table shows where Fibonacci retrace values of the day's high-low range are plus pivot points, calculated on the Dow industrials, sorted by value. When several are near each other (small differences), the area might act as support or resistance.

-- Thomas Bulkowski

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© 2017 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  22,549.94    
 Monthly S1  22,990.13  440.20   
 Weekly S2  23,138.98  148.85   
 Weekly S1  23,284.66  145.67   
 Monthly Pivot  23,296.13  11.47   
 Daily S2  23,319.63  23.50   
 Low  23,360.58  40.95   
 Open  23,370.71  10.13   
 Daily S1  23,374.98  4.27   Yes! The Daily S1 is close to the Open.
 Weekly Pivot  23,388.42  13.44   
 61.8% Down from Intraday High  23,397.37  8.94   Yes! The 61.8% Down from Intraday High is close to the Weekly Pivot.
 50% Down from Intraday High  23,408.73  11.36   
 Daily Pivot  23,415.93  7.20   Yes! The Daily Pivot is close to the 50% Down from Intraday High.
 38.2% Down from Intraday High  23,420.09  4.16   Yes! The 38.2% Down from Intraday High is close to the Daily Pivot.
 Close  23,430.33  10.24   
 High  23,456.88  26.55   
 Daily R1  23,471.28  14.40   
 Daily R2  23,512.23  40.95   
 Weekly R1  23,534.10  21.87   
 Weekly R2  23,637.86  103.77   
 Monthly R1  23,736.32  98.46   
 Monthly R2  24,042.32  305.99   

Monday 11/20/17. Market Monday: The Week Ahead

My Prediction

Picture of the nasdaq on the daily scale.

This is a chart of the Nasdaq composite on the daily scale.

I don't see much of interest here. There's no pronounced chart patterns appearing. Well, maybe that's not true.

There's a head-and-shoulder bottom at the start of the channel. And you can throw in some ascending and inverted scallops, too.

I haven't marked the scallops or head-and-shoulders on the chart because I'm feeling lazy tonight. I spent four days this week in my garage working on a jewelry box. It surprises me how long building some of my gizmo's takes. Regardless...

The chart shows the index climbing swiftly, following the two red lines. Those parallel lines form a channel. The price will bounce from one side to the other until it stops and breaks out of the channel.

I haven't studied which direction it'll break out most often. With this channel being so steep, my guess is the breakout will be either sideways or downward. And I don't have any timing on this, either.

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A Brief Look Back

Picture of a flower from my garden.

The following is a brief review of how the markets performed over time. The numbers refer to the close-to-close move in the Dow industrials.

Monday: Up 17.49 points.
Tuesday: Down 30.23 points.
Wednesday: Down 138.19 points.
Thursday: Up 187.08 points.
Friday: Down 100.12 points.

For the Week...

The Dow industrials were down 63.97 points or 0.3%.
The Nasdaq composite was up 31.85 points or 0.5%.
The S&P 500 index was down 3.45 points or 0.1%.

Year to Date...

Dow Industrials
     1.0% down from the high of 23,602.12 on 11/07/2017.
     18.7% up from the low of 19,677.94 on 01/19/2017.
Nasdaq
     0.4% down from the high of 6,806.67 on 11/16/2017.
     25.7% up from the low of 5,397.99 on 01/03/2017.
S&P 500
     0.7% down from the high of 2,597.02 on 11/07/2017.
     14.9% up from the low of 2,245.13 on 01/03/2017.

Options Expiration

No options expire this week.

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Swing and Position Traders: Chart Pattern Indicator

As of 11/17/2017, the CPI had:

6 bearish patterns,
31 bullish patterns,
323 patterns waiting for breakout.
The CPI signal is 83.8%, which is bullish (>= 65%).

The chart pattern indicator is bullish with 2 of 3 half triangles showing (). Additional triangles are a measure of strength with solid triangles meaning a more reliable signal than half triangles.

Swing Traders: Pivot Points

The following is based on an SFO article in December 2004 by John Seekinger, titled, "Take a two-dimensional approach." He offers these tips.

IndexS2S1PivotR1R2
Dow Industrials (^DJI): Daily  23,305  23,332  23,383  23,409  23,460 
Weekly  23,115  23,237  23,364  23,486  23,614 
Monthly  22,526  22,942  23,272  23,688  24,018 
S&P500 (^GSPC): Daily  2,574  2,576  2,580  2,583  2,586 
Weekly  2,543  2,561  2,575  2,593  2,608 
Monthly  2,520  2,550  2,573  2,603  2,626 
Nasdaq (^IXIC): Daily  6,766  6,774  6,786  6,795  6,806 
Weekly  6,613  6,698  6,752  6,837  6,892 
Monthly  6,414  6,598  6,702  6,887  6,991 
  • Seekinger doesn't look at the range of S2 to R2 as support and resistance levels. Rather, he considers them oversold (S) and overbought (R) areas.
  • S2 to R2 range of values across daily, weekly, and monthly periods: If two values are close together then they lend more significance to the area.
  • If the market trends on day 1, the odds rise tremendously that the market will be range bound between daily S1 and daily R1 the next day.
  • In a quiet market when traders are waiting for an important earnings announcement or economic report, look for daily R1 and S1 levels to hold and for the market to return to the daily pivot.
  • A move outside of daily R1 or S1 usually does not mean a breakout.
  • The odds suggest that the entire week's price action will remain between weekly R2 and S2.
  • Avoid going long when the market moves above weekly R2 (it's overbought) and avoid going short when price moves below weekly S2 (oversold).
  • Consider going short at weekly R1 or long at weekly S1 with a profit objective of the weekly pivot.
  • Consider going long at weekly S2 or short at weekly R2 with a profit objective of weekly S1 or R1, respectively.

Here are the formulas:

Pivot point: P = (H + L + C)/3
First resistance level: R1 = (2 * P) - L
First support level: S1 = (2 * P) - H)
Second resistance level: R2 = P + (R1 - S1)
Second support level: S2 = P - (R1 - S1)
H = high price , L=low price, C=closing price

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Consecutive Price Trends

Index Consecutive
Closes So Far 
% Comments 
 Dow industrials (^DJI) 2 weeks down 15.7%   Expect a reversal soon. 
 1 month down 20.6%   Expect a reversal soon. 
 S & P 500 (^GSPC) 2 weeks down 14.4%   Expect a reversal soon. 
 8 months up 0.0%   Expect a reversal soon. 
 Nasdaq composite (^IXIC) 1 week up 45.8%   Expect a random direction. 
 5 months up 14.1%   Expect a reversal soon. 

How long can an index close higher (or lower) each day? The adjacent table shows how often consecutive up or down closes occur in the indices, based on the most recent trend of closes.

Low percentages suggest the market is overdue to turn (think of it as the likelihood that next week or next month will continue the trend, based on historical performance). Values of 50% mean random, so most percentages will be lower.

The analysis uses data going back 10 years for weekly percentages and 25 years for monthly percentages (or the start of data, whichever is more recent). Any unchanged closing price is interpreted as the end of the string of consecutive up or down closes.

Earnings, Chart Patterns & Industries

Earnings season is either underway or should be starting soon. The sessions could be more volatile.

Mutual funds will begin dividend distributions and rebalancing their portfolios for the approaching year end (starts in late November).

 Found Chart Pattern Name
19Double Top, Adam and Adam
14Head-and-shoulders top
12Dead-cat bounce
11Triangle, symmetrical
9Broadening top
7Pipe top
7Double Bottom, Adam and Adam
4Pipe bottom
4Triple top
4Double Top, Eve and Eve

Large numbers of bullish or bearish chart patterns can signal short- to intermediate-term market trends (many bullish chart patterns can mean an uptrend will continue, for example). However, please realize that the short-term price trend could have changed since the pattern was discovered (this is especially true of pipe tops or bottoms, which are weekly patterns).

The 10 types of most frequently appearing chart patterns in the stocks, indices, and long-only exchange traded funds I follow during the last month are shown in the adjacent table.

 

 

 

 

The industries I follow were the best (rank 1) and worst performing.

This WeekLast Week
1. Semiconductor1. Semiconductor
2. Trucking/Transp. Leasing2. Trucking/Transp. Leasing
3. Human Resources3. Computer Software and Svcs
4. Computer Software and Svcs4. Human Resources
5. Homebuilding5. Homebuilding
50. Food Processing50. Food Processing
51. Petroleum (Producing)51. Retail (Special Lines)
52. Cement and Aggregates52. Cement and Aggregates
53. Drug53. Drug
54. Household Products54. Household Products
55. Advertising55. Furn/Home Furnishings
56. Oilfield Svcs/Equipment56. Advertising
57. Short ETFs57. Short ETFs

-- Thomas Bulkowski

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Friday 11/17/17. Pattern Trading Setups for the Weekend.

Go to Table.

You can find setups based on a Fibonacci retrace by clicking on the link.

Click the link for a list of symbols from the table.

The following patterns were found manually, so the results may differ from those found using Patternz.

There were 19 patterns found this week (excluding pipe bottoms; pipe tops and bottoms are found looking back 2 weeks) out of 595 stocks searched, or 3.2%. Based on the percentage, the stock market is trending since few consolidation patterns appear.

Excluding ETFs, there were 4 bullish chart patterns this week and 9 bearish ones with any remaining (3) being undecided. The ratio of bullish to bearish patterns suggests the market is hinting of a coming bearish (down) turn.

In the table below, the red and green colors are based on the historical breakout direction for the associated chart pattern. If a high and tight flag appears, the start and end dates highlight the flagpole only and not the flag.

More...

-- Thomas Bulkowski

 

Symbol Chart Pattern Bullish
Bearish
Start End Industry
ALBHead-and-shoulders top      11/02/201711/13/2017Chemical (Diversified)
BOOTFlag, high and tight      10/13/201711/16/2017Shoe
BLDRBroadening top      09/29/201711/10/2017Retail Building Supply
CBTPipe top      10/30/201711/06/2017Chemical (Diversified)
COGBroadening top, right-angled and ascending      07/17/201711/13/2017Natural Gas (Diversified)
CFBroadening wedge, ascending      10/17/201711/13/2017Chemical (Basic)
CTSDouble Bottom, Adam and Adam      11/08/201711/15/2017Electronics
DODouble Top, Adam and Adam      11/01/201711/10/2017Oilfield Svcs/Equipment
ESLDead-cat bounce      11/10/201711/10/2017Precision Instrument
ILMNTriangle, ascending      09/12/201711/16/2017Biotechnology
PKETriangle, symmetrical      10/03/201711/15/2017Chemical (Specialty)
RESPipe top      10/30/201711/06/2017Oilfield Svcs/Equipment
SHLMPipe top      11/06/201711/06/2017Chemical (Specialty)
TGTHead-and-shoulders top      10/13/201711/13/2017Retail Store
TRVDouble Top, Adam and Adam      11/02/201711/10/2017Insurance (Prop/Casualty)
VRTXTriangle, symmetrical      10/26/201711/16/2017Biotechnology
SLVTriangle, symmetrical      10/16/201711/16/2017Metals and Mining (Div.)
EWIBroadening top      10/04/201711/15/2017Investment Co. (Foreign)
EWUTriangle, descending      10/06/201711/10/2017Investment Co. (Foreign)

 

Weekly screen for chart patterns ending between 11/09/2017 and 11/16/2017. Many may be still in development. If no securities appear, then I have not identified any new patterns.

Definitions
RS is relative strength (where 1 is best). For other definitions, see the glossary.
’Breakout is upward/downward 100% of the time’ means price breaks out up/down by definition, not by statistically measuring the rate.
All numbers assume a bull market and are based on the breakout direction that occurs most often.
For more information, consult my book, Encyclopedia of Chart Patterns, Second Edition.
 
Albemarle Corp. (ALB)
Industry: Chemical (Diversified)
Industry RS rank: 25 out of 56
Stock RS rank: 122 out of 587
11/16/17 close: $135.33
1 Month avg volatility: $2.93. Volatility stop (for downward breakout): $142.60 or 5.4% above the close.
Change YTD: 57.21%
Volume: 1,912,700 shares. 3 month avg: 1,303,108 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Friday.
 
Chart pattern: Head-and-shoulders top reversal pattern from 11/02/2017 to 11/13/2017
Breakout is downward 100% of the time.
Average decline: 22%.
Break-even failure rate: 4%.
Pullbacks occur 50% of the time.
Price hits measure rule target 55% of the time.

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Boot Barn Holdings Inc (BOOT)
Industry: Shoe
Industry RS rank: 11 out of 56
Stock RS rank: 18 out of 587
11/16/17 close: $13.54
1 Month avg volatility: $0.65. Volatility stop (for upward breakout): $11.31 or 16.5% below the close.
Change YTD: 8.15%
Volume: 1,208,600 shares. 3 month avg: 385,517 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Friday.
 
Chart pattern: Flag, high and tight continuation pattern from 10/13/2017 to 11/16/2017
WARNING: A dead-cat bounce occurred on 06/02/2017. There is a 38% chance that a 15% or higher decline will occur (or has occurred since then) by 12/01/2017.
Breakout is upward 100% of the time.
Average rise: 69%.
Throwbacks occur 54% of the time.
Price hits measure rule target 90% of the time.

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Builders FirstSource, Inc (BLDR)
Industry: Retail Building Supply
Industry RS rank: 13 out of 56
Stock RS rank: 57 out of 587
11/16/17 close: $18.67
1 Month avg volatility: $0.59. Volatility stop (for downward breakout): $20.04 or 7.3% above the close.
Change YTD: 70.19%
Volume: 1,917,700 shares. 3 month avg: 1,325,434 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Broadening top reversal pattern from 09/29/2017 to 11/10/2017
Breakout is downward 50% of the time.
Average decline: 15%.
Break-even failure rate: 18%.
Pullbacks occur 48% of the time.
Price hits measure rule target 37% of the time.

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Cabot Corp. (CBT)
Industry: Chemical (Diversified)
Industry RS rank: 25 out of 56
Stock RS rank: 159 out of 587
11/16/17 close: $60.48
1 Month avg volatility: $1.02. Volatility stop (for downward breakout): $63.04 or 4.2% above the close.
Change YTD: 19.67%
Volume: 462,200 shares. 3 month avg: 337,625 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Pipe top reversal pattern from 10/30/2017 to 11/06/2017
Breakout is downward 100% of the time.
Average decline: 20%.
Break-even failure rate: 11%.
Pullbacks occur 41% of the time.
Price hits measure rule target 70% of the time.

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Cabot Oil and Gas A (COG)
Industry: Natural Gas (Diversified)
Industry RS rank: 44 out of 56
Stock RS rank: 115 out of 587
11/16/17 close: $28.74
1 Month avg volatility: $0.65. Volatility stop (for downward breakout): $30.15 or 4.9% above the close.
Change YTD: 23.03%
Volume: 3,802,800 shares. 3 month avg: 5,453,889 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Broadening top, right-angled and ascending reversal pattern from 07/17/2017 to 11/13/2017
Breakout is downward 66% of the time.
Average decline: 15%.
Break-even failure rate: 20%.
Pullbacks occur 65% of the time.
Price hits measure rule target 32% of the time.

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CF Industries Holdings, Inc. (CF)
Industry: Chemical (Basic)
Industry RS rank: 7 out of 56
Stock RS rank: 62 out of 587
11/16/17 close: $36.17
1 Month avg volatility: $1.12. Volatility stop (for downward breakout): $39.07 or 8.0% above the close.
Change YTD: 14.90%
Volume: 3,136,300 shares. 3 month avg: 3,817,734 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Broadening wedge, ascending reversal pattern from 10/17/2017 to 11/13/2017
Breakout is downward 73% of the time.
Average decline: 17%.
Break-even failure rate: 11%.
Pullbacks occur 57% of the time.
Price hits measure rule target 58% of the time.

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CTS Corp (CTS)
Industry: Electronics
Industry RS rank: 14 out of 56
Stock RS rank: 66 out of 587
11/16/17 close: $26.75
1 Month avg volatility: $0.64. Volatility stop (for upward breakout): $24.72 or 7.6% below the close.
Change YTD: 19.42%
Volume: 72,400 shares. 3 month avg: 64,557 shares.
This security may be thinly traded (less than 100k shares)!
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Double Bottom, Adam and Adam reversal pattern from 11/08/2017 to 11/15/2017
Breakout is upward 100% of the time.
Average rise: 35%.
Break-even failure rate: 5%.
Throwbacks occur 64% of the time.
Price hits measure rule target 66% of the time.

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Diamond Offshore (DO)
Industry: Oilfield Svcs/Equipment
Industry RS rank: 54 out of 56
Stock RS rank: 166 out of 587
11/16/17 close: $15.76
1 Month avg volatility: $0.70. Volatility stop (for downward breakout): $17.35 or 10.1% above the close.
Change YTD: -10.96%
Volume: 1,170,100 shares. 3 month avg: 2,751,158 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Double Top, Adam and Adam reversal pattern from 11/01/2017 to 11/10/2017
Breakout is downward 100% of the time.
Average decline: 19%.
Break-even failure rate: 8%.
Pullbacks occur 61% of the time.
Price hits measure rule target 72% of the time.

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Esterline Technologies Corp. (ESL)
Industry: Precision Instrument
Industry RS rank: 17 out of 56
Stock RS rank: 555 out of 587
11/16/17 close: $71.60
1 Month avg volatility: $2.38. Volatility stop (for downward breakout): $77.21 or 7.8% above the close.
Change YTD: -19.73%
Volume: 520,800 shares. 3 month avg: 209,489 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Dead-cat bounce continuation pattern from 11/10/2017 to 11/10/2017
Breakout is downward 67% of the time.
Average decline: 18%.

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Illumina Inc (ILMN)
Industry: Biotechnology
Industry RS rank: 27 out of 56
Stock RS rank: 160 out of 587
11/16/17 close: $208.51
1 Month avg volatility: $4.78. Volatility stop (for upward breakout): $195.84 or 6.1% below the close.
Change YTD: 62.85%
Volume: 563,400 shares. 3 month avg: 737,468 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Triangle, ascending reversal pattern from 09/12/2017 to 11/16/2017
Breakout is upward 70% of the time.
Average rise: 35%.
Break-even failure rate: 13%.
Throwbacks occur 57% of the time.
Price hits measure rule target 75% of the time.

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Park Electrochemical (PKE)
Industry: Chemical (Specialty)
Industry RS rank: 48 out of 56
Stock RS rank: 230 out of 587
11/16/17 close: $18.97
1 Month avg volatility: $0.34. Volatility stop (for upward breakout): $17.87 or 5.8% below the close.
Change YTD: 1.72%
Volume: 51,000 shares. 3 month avg: 62,165 shares.
This security may be thinly traded (less than 100k shares)!
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Triangle, symmetrical continuation pattern from 10/03/2017 to 11/15/2017
Breakout is upward 54% of the time.
Average rise: 31%.
Break-even failure rate: 9%.
Throwbacks occur 37% of the time.
Price hits measure rule target 66% of the time.

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RPC Inc (RES)
Industry: Oilfield Svcs/Equipment
Industry RS rank: 54 out of 56
Stock RS rank: 103 out of 587
11/16/17 close: $22.88
1 Month avg volatility: $0.77. Volatility stop (for downward breakout): $24.77 or 8.3% above the close.
Change YTD: 15.50%
Volume: 1,298,200 shares. 3 month avg: 1,495,915 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Pipe top reversal pattern from 10/30/2017 to 11/06/2017
Breakout is downward 100% of the time.
Average decline: 20%.
Break-even failure rate: 11%.
Pullbacks occur 41% of the time.
Price hits measure rule target 70% of the time.

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Schulman, A. (SHLM)
Industry: Chemical (Specialty)
Industry RS rank: 48 out of 56
Stock RS rank: 90 out of 587
11/16/17 close: $37.15
1 Month avg volatility: $0.88. Volatility stop (for downward breakout): $39.31 or 5.8% above the close.
Change YTD: 11.06%
Volume: 175,600 shares. 3 month avg: 290,615 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Pipe top reversal pattern from 11/06/2017 to 11/06/2017
Breakout is downward 100% of the time.
Average decline: 20%.
Break-even failure rate: 11%.
Pullbacks occur 41% of the time.
Price hits measure rule target 70% of the time.

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Target (TGT)
Industry: Retail Store
Industry RS rank: 43 out of 56
Stock RS rank: 429 out of 587
11/16/17 close: $55.10
1 Month avg volatility: $1.40. Volatility stop (for downward breakout): $58.13 or 5.5% above the close.
Change YTD: -23.72%
Volume: 12,702,200 shares. 3 month avg: 7,109,708 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Head-and-shoulders top reversal pattern from 10/13/2017 to 11/13/2017
Breakout is downward 100% of the time.
Average decline: 22%.
Break-even failure rate: 4%.
Pullbacks occur 50% of the time.
Price hits measure rule target 55% of the time.

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Travelers Companies Inc, The (TRV)
Industry: Insurance (Prop/Casualty)
Industry RS rank: 40 out of 56
Stock RS rank: 310 out of 587
11/16/17 close: $130.81
1 Month avg volatility: $1.95. Volatility stop (for downward breakout): $137.47 or 5.1% above the close.
Change YTD: 6.85%
Volume: 2,327,300 shares. 3 month avg: 1,669,966 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Tuesday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Double Top, Adam and Adam reversal pattern from 11/02/2017 to 11/10/2017
Breakout is downward 100% of the time.
Average decline: 19%.
Break-even failure rate: 8%.
Pullbacks occur 61% of the time.
Price hits measure rule target 72% of the time.

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Vertex Pharmaceuticals (VRTX)
Industry: Biotechnology
Industry RS rank: 27 out of 56
Stock RS rank: 73 out of 587
11/16/17 close: $147.94
1 Month avg volatility: $4.73. Volatility stop (for upward breakout): $138.30 or 6.5% below the close.
Change YTD: 100.81%
Volume: 1,372,500 shares. 3 month avg: 1,492,394 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Triangle, symmetrical continuation pattern from 10/26/2017 to 11/16/2017
Breakout is upward 54% of the time.
Average rise: 31%.
Break-even failure rate: 9%.
Throwbacks occur 37% of the time.
Price hits measure rule target 66% of the time.

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iShares Silver Trust (SLV)
Industry: Metals and Mining (Div.)
Industry RS rank: 30 out of 56
Stock RS rank: 424 out of 587
11/16/17 close: $16.12
1 Month avg volatility: $0.21. Volatility stop (for upward breakout): $15.67 or 2.8% below the close.
Change YTD: 6.68%
Volume: 4,403,300 shares. 3 month avg: 7,025,995 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Triangle, symmetrical continuation pattern from 10/16/2017 to 11/16/2017
Breakout is upward 54% of the time.
Average rise: 31%.
Break-even failure rate: 9%.
Throwbacks occur 37% of the time.
Price hits measure rule target 66% of the time.

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MSCI Italy Index (EWI)
Industry: Investment Co. (Foreign)
Industry RS rank: 37 out of 56
Stock RS rank: 303 out of 587
11/16/17 close: $30.50
1 Month avg volatility: $0.20. Volatility stop (for downward breakout): $30.93 or 1.4% above the close.
Change YTD: 25.98%
Volume: 929,000 shares. 3 month avg: 925,658 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Broadening top reversal pattern from 10/04/2017 to 11/15/2017
Breakout is downward 50% of the time.
Average decline: 15%.
Break-even failure rate: 18%.
Pullbacks occur 48% of the time.
Price hits measure rule target 37% of the time.

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MSCI United Kingdom Index (EWU)
Industry: Investment Co. (Foreign)
Industry RS rank: 37 out of 56
Stock RS rank: 428 out of 587
11/16/17 close: $34.41
1 Month avg volatility: $0.17. Volatility stop (for downward breakout): $34.79 or 1.1% above the close.
Change YTD: 12.12%
Volume: 1,561,600 shares. 3 month avg: 1,704,806 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Triangle, descending reversal pattern from 10/06/2017 to 11/10/2017
Breakout is downward 64% of the time.
Average decline: 16%.
Break-even failure rate: 16%.
Pullbacks occur 54% of the time.
Price hits measure rule target 54% of the time.

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Thursday 11/16/17. Intraday Market Direction: Nasdaq

The index dropped by -0.5% or -31.66 points. Since 02/05/1971 the index made 335 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.8% on 161 occasions.
     Average loss was -1.0% on 174 occasions.
Expect the index to close lower 51.9% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 138/246 or 56.1% of the time.
     The prediction of the index closing lower has been right 43/83 or 51.8% of the time.

Since I post this the night before, check how the futures are trading before market open. Large moves can affect the opening direction.

Picture of the Nasdaq composite on the 5 minute scale.

$ $ $

I show a picture of the Nasdaq composite on the 5-minute scale.

The chart shows two prominent patterns. The first is a double top with peaks at D and E. It confirms as a valid pattern when the index closes below the cyan line.

Notice that the drop fulfills the measure rule for double tops. That is, the height of the pattern subtracted from the breakout price (the price of the cyan line) gives a target. The index exceeded the target on the way to F. If you bought after the pattern confirmed (that is, after the gap), you'd still have hit a lower target, right about the price of F.

A similar double top appears at AB, confirmed at C. This one hasn't shown a full measure rule decline yet. By full measure, I mean using the full height of the pattern (versus a portion of it) in the measure rule calculation.

$ $ $

The following table shows where Fibonacci retrace values of the day's high-low range are plus pivot points, calculated on the Nasdaq composite, sorted by value. When several are near each other (small differences), the area might act as support or resistance.

-- Thomas Bulkowski

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© 2017 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  6,395.63    
 Monthly S1  6,550.92  155.29   
 Weekly S2  6,621.43  70.51   
 Daily S2  6,641.60  20.17   
 Weekly S1  6,663.82  22.22   
 Low  6,667.31  3.49   Yes! The Low is close to the Weekly S1.
 Monthly Pivot  6,673.22  5.91   
 Daily S1  6,673.91  0.69   Yes! The Daily S1 is close to the Monthly Pivot.
 61.8% Down from Intraday High  6,689.47  15.56   
 50% Down from Intraday High  6,696.31  6.85   
 Daily Pivot  6,699.61  3.30   Yes! The Daily Pivot is close to the 50% Down from Intraday High.
 Open  6,700.68  1.07   Yes! The Open is close to the Daily Pivot.
 38.2% Down from Intraday High  6,703.16  2.48   Yes! The 38.2% Down from Intraday High is close to the Open.
 Close  6,706.21  3.05   Yes! The Close is close to the 38.2% Down from Intraday High.
 High  6,725.32  19.11   
 Weekly Pivot  6,729.67  4.35   Yes! The Weekly Pivot is close to the High.
 Daily R1  6,731.92  2.25   Yes! The Daily R1 is close to the Weekly Pivot.
 Daily R2  6,757.62  25.71   
 Weekly R1  6,772.06  14.44   
 Monthly R1  6,828.51  56.45   
 Weekly R2  6,837.91  9.40   
 Monthly R2  6,950.81  112.90   

Wednesday 11/15/17. A Look At Indicators

Picture of the chart pattern indicator

This is a picture of the chart pattern indicator on the daily scale. The indicator is the line chart below a chart of the S&P 500 composite.

The chart pattern indicator, shown here by the wavy and thin blue line near the bottom of the chart, has turned bearish. I show that with the vertical red line on the far right.

The index has followed the CPI lower, too.

Picture of the percent down indicators

The red line is the percentage of stocks at least 20% below their 1-year high (plotted upside down). The blue line is the average percentage drop of stocks below their 1-year high (plotted upside down).

Shown as a red line on the above chart...
On Monday, 25% of stocks in my database are in bear market territory (down at least 20% from their 1-year high).
A week ago, it was 23%.
The fewest was 14% on 12/09/2016.
And the most was 29% on 08/21/2017.
Shown as a blue line on the above chart...
The 497 stocks in my database are down an average of 13% from their yearly high.
A week ago, the average was 13%.
The peak was 9% on 12/09/2016.
And the bottom was 16% on 08/21/2017.

The more sensitive red line has continued to move lower, by another two percentage points. That's a big drop.

The blue line is flat from a week ago.

Taken together, with the CPI chart, it suggests more weakness ahead. I'm not so sure about that. I feel that earnings season will end and the index will recover to new highs. I could be wrong, of course.

-- Thomas Bulkowski

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Tuesday 11/14/17. Intraday Market Direction: Dow

The index climbed by 0.1% or 17.49 points. Since 10/01/1928 the index made 1323 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.5% on 683 occasions.
     Average loss was -0.6% on 640 occasions.
Expect the index to close higher 51.6% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 151/253 or 59.7% of the time.
     The prediction of the index closing lower has been right 32/65 or 49.2% of the time.

Since I post this the night before, check how the futures are trading before market open. Large moves can affect the opening direction.

Picture of the Dow industrials on the 5 minute scale.

$ $ $

I show a picture of the Dow industrials on the 5-minute scale.

Look at the pattern outlined by the three turns marked LHR. It might appear as a head-and-shoulders bottom chart pattern. L would be the left shoulder, H is the head, and R is the right shoulder.

At first I thought it didn't confirm as a valid pattern, but it does. However, it happens early today (Monday) when price closes above the neckline, shown here by the green line.

The post-breakout move has been meager so far...

Another pattern shown by the red line is an ascending and inverted scallop. It's not a good example of one because it does not have a smooth turn at the top. They are supposed to breakout upward, so we'll have to wait and see if it does.

$ $ $

I updated the statistics on the Big M chart pattern and the performance over time for all chart patterns.

$ $ $

The following table shows where Fibonacci retrace values of the day's high-low range are plus pivot points, calculated on the Dow industrials, sorted by value. When several are near each other (small differences), the area might act as support or resistance.

-- Thomas Bulkowski

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© 2017 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  22,386.29    
 Monthly S1  22,912.99  526.71   
 Weekly S2  23,158.51  245.52   
 Monthly Pivot  23,257.56  99.04   
 Daily S2  23,296.57  39.01   
 Weekly S1  23,299.11  2.54   Yes! The Weekly S1 is close to the Daily S2.
 Low  23,343.34  44.23   
 Open  23,367.47  24.13   
 Daily S1  23,368.13  0.66   Yes! The Daily S1 is close to the Open.
 61.8% Down from Intraday High  23,388.55  20.41   
 50% Down from Intraday High  23,402.51  13.96   
 Daily Pivot  23,414.91  12.40   
 38.2% Down from Intraday High  23,416.47  1.57   Yes! The 38.2% Down from Intraday High is close to the Daily Pivot.
 Close  23,439.70  23.22   
 Weekly Pivot  23,450.61  10.91   Yes! The Weekly Pivot is close to the Close.
 High  23,461.68  11.07   Yes! The High is close to the Weekly Pivot.
 Daily R1  23,486.47  24.79   
 Daily R2  23,533.25  46.77   
 Weekly R1  23,591.21  57.96   
 Weekly R2  23,742.71  151.51   
 Monthly R1  23,784.26  41.55   
 Monthly R2  24,128.83  344.56   

Monday 11/13/17. Market Monday: The Week Ahead

My Prediction

Picture of the Dow industrials on the daily scale.

I show the Dow industrials on the daily scale.

At first, I didn't see anything remarkable about this chart.

So I drew the two trendlines, AB. Notice that the first one has a decent slope. It's not too steep nor too shallow. These types of trendlines can continue for years.

Trendline B slopes more steeply than does A. That means momentum is increasing. The slope is also unsustainable over the long term.

Of course, the scaling of the chart will change the slope (aspect ratio) of both lines, as will a log/linear scale, so keep that in mind.

Looking at trendline B, notice that the index has dropped below the line at C. That could be the beginning of the end, but my guess is the index will go horizontal.

After that, it'll likely drop more, but it could also rise. The direction at this point isn't clear. I'm basing the down move on my 2017 prediction.

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A Brief Look Back

Picture of a flower from my garden.

The following is a brief review of how the markets performed over time. The numbers refer to the close-to-close move in the Dow industrials.

Monday: Up 9.23 points.
Tuesday: Up 8.81 points.
Wednesday: Up 6.13 points.
Thursday: Down 101.42 points.
Friday: Down 39.73 points.

For the Week...

The Dow industrials were down 116.98 points or 0.5%.
The Nasdaq composite was down 13.5 points or 0.2%.
The S&P 500 index was down 5.54 points or 0.2%.

Year to Date...

Dow Industrials
     0.8% down from the high of 23,602.12 on 11/07/2017.
     19.0% up from the low of 19,677.94 on 01/19/2017.
Nasdaq
     0.7% down from the high of 6,795.52 on 11/07/2017.
     25.1% up from the low of 5,397.99 on 01/03/2017.
S&P 500
     0.6% down from the high of 2,597.02 on 11/07/2017.
     15.0% up from the low of 2,245.13 on 01/03/2017.

Options Expiration

Many options expire this week, so traders will be looking to close out their positions, and that suggests increased volatility (large daily price swings).

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Swing and Position Traders: Chart Pattern Indicator

As of 11/10/2017, the CPI had:

14 bearish patterns,
7 bullish patterns,
362 patterns waiting for breakout.
The CPI signal is 33.3%, which is bearish (<= 35%).

The chart pattern indicator is bearish with 2 of 3 half triangles showing (). Additional triangles are a measure of strength with solid triangles meaning a more reliable signal than half triangles.

Swing Traders: Pivot Points

The following is based on an SFO article in December 2004 by John Seekinger, titled, "Take a two-dimensional approach." He offers these tips.

IndexS2S1PivotR1R2
Dow Industrials (^DJI): Daily  23,363  23,393  23,422  23,452  23,482 
Weekly  23,153  23,287  23,445  23,580  23,737 
Monthly  22,380  22,901  23,252  23,773  24,123 
S&P500 (^GSPC): Daily  2,572  2,577  2,581  2,586  2,589 
Weekly  2,551  2,567  2,582  2,597  2,613 
Monthly  2,518  2,550  2,574  2,606  2,629 
Nasdaq (^IXIC): Daily  6,715  6,733  6,745  6,763  6,775 
Weekly  6,636  6,694  6,745  6,802  6,853 
Monthly  6,411  6,581  6,688  6,858  6,966 
  • Seekinger doesn't look at the range of S2 to R2 as support and resistance levels. Rather, he considers them oversold (S) and overbought (R) areas.
  • S2 to R2 range of values across daily, weekly, and monthly periods: If two values are close together then they lend more significance to the area.
  • If the market trends on day 1, the odds rise tremendously that the market will be range bound between daily S1 and daily R1 the next day.
  • In a quiet market when traders are waiting for an important earnings announcement or economic report, look for daily R1 and S1 levels to hold and for the market to return to the daily pivot.
  • A move outside of daily R1 or S1 usually does not mean a breakout.
  • The odds suggest that the entire week's price action will remain between weekly R2 and S2.
  • Avoid going long when the market moves above weekly R2 (it's overbought) and avoid going short when price moves below weekly S2 (oversold).
  • Consider going short at weekly R1 or long at weekly S1 with a profit objective of the weekly pivot.
  • Consider going long at weekly S2 or short at weekly R2 with a profit objective of weekly S1 or R1, respectively.

Here are the formulas:

Pivot point: P = (H + L + C)/3
First resistance level: R1 = (2 * P) - L
First support level: S1 = (2 * P) - H)
Second resistance level: R2 = P + (R1 - S1)
Second support level: S2 = P - (R1 - S1)
H = high price , L=low price, C=closing price

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Consecutive Price Trends

Index Consecutive
Closes So Far 
% Comments 
 Dow industrials (^DJI) 1 week down 28.0%   The trend may continue. 
 8 months up 0.0%   Expect a reversal soon. 
 S & P 500 (^GSPC) 1 week down 26.8%   The trend may continue. 
 8 months up 0.0%   Expect a reversal soon. 
 Nasdaq composite (^IXIC) 1 week down 27.7%   The trend may continue. 
 5 months up 14.1%   Expect a reversal soon. 

How long can an index close higher (or lower) each day? The adjacent table shows how often consecutive up or down closes occur in the indices, based on the most recent trend of closes.

Low percentages suggest the market is overdue to turn (think of it as the likelihood that next week or next month will continue the trend, based on historical performance). Values of 50% mean random, so most percentages will be lower.

The analysis uses data going back 10 years for weekly percentages and 25 years for monthly percentages (or the start of data, whichever is more recent). Any unchanged closing price is interpreted as the end of the string of consecutive up or down closes.

Earnings, Chart Patterns & Industries

Earnings season is either underway or should be starting soon. The sessions could be more volatile.

Mutual funds will begin dividend distributions and rebalancing their portfolios for the approaching year end (starts in late November).

 Found Chart Pattern Name
14Triangle, symmetrical
14Double Top, Adam and Adam
13Head-and-shoulders top
12Dead-cat bounce
11Pipe bottom
5Pipe top
5Broadening top
4Double Top, Adam and Eve
4Double Top, Eve and Adam
4Rising wedge

Large numbers of bullish or bearish chart patterns can signal short- to intermediate-term market trends (many bullish chart patterns can mean an uptrend will continue, for example). However, please realize that the short-term price trend could have changed since the pattern was discovered (this is especially true of pipe tops or bottoms, which are weekly patterns).

The 10 types of most frequently appearing chart patterns in the stocks, indices, and long-only exchange traded funds I follow during the last month are shown in the adjacent table.

 

 

 

 

The industries I follow were the best (rank 1) and worst performing.

This WeekLast Week
1. Semiconductor1. Semiconductor
2. Trucking/Transp. Leasing2. Trucking/Transp. Leasing
3. Computer Software and Svcs3. Computer Software and Svcs
4. Human Resources4. Semiconductor Cap Equip.
5. Homebuilding5. Homebuilding
50. Food Processing50. Food Processing
51. Retail (Special Lines)51. Cement and Aggregates
52. Cement and Aggregates52. Retail Store
53. Drug53. Drug
54. Household Products54. Furn/Home Furnishings
55. Furn/Home Furnishings55. Household Products
56. Advertising56. Advertising
57. Short ETFs57. Short ETFs

-- Thomas Bulkowski

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Friday 11/10/17. Pattern Trading Setups for the Weekend.

I updated the statistics of the ascending and descending variety of right-angled broadening formations today.

$ $ $

Go to Table.

You can find setups based on a Fibonacci retrace by clicking on the link.

Click the link for a list of symbols from the table.

The following patterns were found manually, so the results may differ from those found using Patternz.

There were 15 patterns found this week (excluding pipe bottoms; pipe tops and bottoms are found looking back 2 weeks) out of 595 stocks searched, or 2.5%. Based on the percentage, the stock market is trending since few consolidation patterns appear.

I found 1 pipe bottom chart patterns, which is neutral. High numbers of pipe bottoms can signal a bullish move (I see many of them just before a bear market ends or during a bear market rally. Often it means the first bottom of a double bottom has formed. Thus, expect a move down to the second bottom).

Excluding ETFs, there were 4 bullish chart patterns this week and 6 bearish ones with any remaining (3) being undecided. The ratio of bullish to bearish patterns suggests the market is hinting of a coming bearish (down) turn.

In the table below, the red and green colors are based on the historical breakout direction for the associated chart pattern. If a high and tight flag appears, the start and end dates highlight the flagpole only and not the flag.

More...

-- Thomas Bulkowski

 

Symbol Chart Pattern Bullish
Bearish
Start End Industry
BRKSDead-cat bounce      11/09/201711/09/2017Semiconductor Cap Equip.
CGIFlag      10/27/201711/09/2017Trucking/Transp. Leasing
CAGTriangle, symmetrical      09/15/201711/09/2017Food Processing
CBPXDiamond top      10/09/201711/07/2017Retail Building Supply
EGNPipe bottom      10/23/201710/30/2017Natural Gas (Diversified)
JBHTHead-and-shoulders top      10/23/201711/06/2017Trucking/Transp. Leasing
ILMNTriangle, ascending      09/12/201711/09/2017Biotechnology
INFNDead-cat bounce      11/09/201711/09/2017Telecom. Equipment
PKETriangle, symmetrical      10/03/201711/09/2017Chemical (Specialty)
PICOPipe top      10/23/201710/30/2017Diversified Co.
STMPDead-cat bounce      11/03/201711/03/2017Internet
SXIBroadening top      10/13/201711/09/2017Diversified Co.
TREXPennant      11/01/201711/09/2017Building Materials
EWMDouble Bottom, Adam and Adam      10/25/201711/03/2017Investment Co. (Foreign)
PXJTriangle, ascending      07/19/201711/09/2017Oilfield Svcs/Equipment
XLPDouble Bottom, Adam and Adam      10/30/201711/07/2017Household Products

 

Weekly screen for chart patterns ending between 11/02/2017 and 11/09/2017. Many may be still in development. If no securities appear, then I have not identified any new patterns.

Definitions
RS is relative strength (where 1 is best). For other definitions, see the glossary.
’Breakout is upward/downward 100% of the time’ means price breaks out up/down by definition, not by statistically measuring the rate.
All numbers assume a bull market and are based on the breakout direction that occurs most often.
For more information, consult my book, Encyclopedia of Chart Patterns, Second Edition.
 
Brooks Automation (BRKS)
Industry: Semiconductor Cap Equip.
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 5 out of 56
Stock RS rank: 343 out of 587
11/9/17 close: $28.78
1 Month avg volatility: $1.28. Volatility stop (for downward breakout): $36.05 or 25.3% above the close.
Change YTD: 68.60%
Volume: 3,668,600 shares. 3 month avg: 651,645 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Tuesday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Dead-cat bounce continuation pattern from 11/09/2017 to 11/09/2017
Breakout is downward 67% of the time.
Average decline: 18%.

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Celadon Group Inc. (CGI)
Industry: Trucking/Transp. Leasing
Industry RS rank: 2 out of 56
Stock RS rank: 1 out of 587
11/9/17 close: $7.25
1 Month avg volatility: $0.44. Volatility stop (for upward breakout): $6.33 or 12.7% below the close.
Change YTD: 1.40%
Volume: 237,300 shares. 3 month avg: 440,063 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Flag continuation pattern from 10/27/2017 to 11/09/2017
Breakout is upward 54% of the time.
Average rise: 23%.
Break-even failure rate: 4%.
Throwbacks occur 43% of the time.
Price hits measure rule target 64% of the time.

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ConAgra Brands Inc (CAG)
Industry: Food Processing
Industry RS rank: 49 out of 56
Stock RS rank: 493 out of 587
11/9/17 close: $33.96
1 Month avg volatility: $0.51. Volatility stop (for upward breakout): $32.87 or 3.2% below the close.
Change YTD: -14.13%
Volume: 2,154,900 shares. 3 month avg: 3,574,017 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Thursday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Triangle, symmetrical continuation pattern from 09/15/2017 to 11/09/2017
Breakout is upward 54% of the time.
Average rise: 31%.
Break-even failure rate: 9%.
Throwbacks occur 37% of the time.
Price hits measure rule target 66% of the time.

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Continental Building Products Inc (CBPX)
Industry: Retail Building Supply
Industry RS rank: 20 out of 56
Stock RS rank: 366 out of 587
11/9/17 close: $25.80
1 Month avg volatility: $0.50. Volatility stop (for downward breakout): $27.20 or 5.4% above the close.
Change YTD: 11.69%
Volume: 362,800 shares. 3 month avg: 381,200 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Tuesday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Diamond top reversal pattern from 10/09/2017 to 11/07/2017
Breakout is downward 69% of the time.
Average decline: 21%.
Break-even failure rate: 6%.
Pullbacks occur 57% of the time.
Price hits measure rule target 76% of the time.

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Energen Corp (EGN)
Industry: Natural Gas (Diversified)
Industry RS rank: 32 out of 56
Stock RS rank: 311 out of 587
11/9/17 close: $56.67
1 Month avg volatility: $1.40. Volatility stop (for upward breakout): $52.21 or 7.9% below the close.
Change YTD: -1.73%
Volume: 1,713,400 shares. 3 month avg: 1,195,235 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Pipe bottom reversal pattern from 10/23/2017 to 10/30/2017
Breakout is upward 100% of the time.
Average rise: 45%.
Break-even failure rate: 5%.
Throwbacks occur 44% of the time.
Price hits measure rule target 83% of the time.

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Hunt, J.B. (JBHT)
Industry: Trucking/Transp. Leasing
Industry RS rank: 2 out of 56
Stock RS rank: 139 out of 587
11/9/17 close: $102.00
1 Month avg volatility: $2.44. Volatility stop (for downward breakout): $108.98 or 6.8% above the close.
Change YTD: 5.08%
Volume: 1,255,000 shares. 3 month avg: 964,251 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Friday.
 
Chart pattern: Head-and-shoulders top reversal pattern from 10/23/2017 to 11/06/2017
Breakout is downward 100% of the time.
Average decline: 22%.
Break-even failure rate: 4%.
Pullbacks occur 50% of the time.
Price hits measure rule target 55% of the time.

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Illumina Inc (ILMN)
Industry: Biotechnology
Industry RS rank: 30 out of 56
Stock RS rank: 179 out of 587
11/9/17 close: $209.61
1 Month avg volatility: $4.76. Volatility stop (for upward breakout): $198.20 or 5.4% below the close.
Change YTD: 63.71%
Volume: 347,500 shares. 3 month avg: 761,595 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Triangle, ascending reversal pattern from 09/12/2017 to 11/09/2017
Breakout is upward 70% of the time.
Average rise: 35%.
Break-even failure rate: 13%.
Throwbacks occur 57% of the time.
Price hits measure rule target 75% of the time.

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Infinera Corp. (INFN)
Industry: Telecom. Equipment
Industry RS rank: 24 out of 56
Stock RS rank: 570 out of 587
11/9/17 close: $6.36
1 Month avg volatility: $0.33. Volatility stop (for downward breakout): $8.04 or 26.4% above the close.
Change YTD: -25.09%
Volume: 11,604,100 shares. 3 month avg: 1,482,789 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Dead-cat bounce continuation pattern from 11/09/2017 to 11/09/2017
Breakout is downward 67% of the time.
Average decline: 18%.

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Park Electrochemical (PKE)
Industry: Chemical (Specialty)
Industry RS rank: 46 out of 56
Stock RS rank: 291 out of 587
11/9/17 close: $18.78
1 Month avg volatility: $0.34. Volatility stop (for upward breakout): $17.94 or 4.5% below the close.
Change YTD: 0.70%
Volume: 32,600 shares. 3 month avg: 61,154 shares.
This security may be thinly traded (less than 100k shares)!
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Triangle, symmetrical continuation pattern from 10/03/2017 to 11/09/2017
Breakout is upward 54% of the time.
Average rise: 31%.
Break-even failure rate: 9%.
Throwbacks occur 37% of the time.
Price hits measure rule target 66% of the time.

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PICO Holdings (PICO)
Industry: Diversified Co.
Industry RS rank: 9 out of 56
Stock RS rank: 318 out of 587
11/9/17 close: $17.85
1 Month avg volatility: $0.46. Volatility stop (for downward breakout): $18.92 or 6.0% above the close.
Change YTD: 17.82%
Volume: 82,200 shares. 3 month avg: 129,678 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Monday.
 
Chart pattern: Pipe top reversal pattern from 10/23/2017 to 10/30/2017
Breakout is downward 100% of the time.
Average decline: 20%.
Break-even failure rate: 11%.
Pullbacks occur 41% of the time.
Price hits measure rule target 70% of the time.

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Stamps.com (STMP)
Industry: Internet
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 35 out of 56
Stock RS rank: 8 out of 587
11/9/17 close: $174.30
1 Month avg volatility: $8.79. Volatility stop (for downward breakout): $193.28 or 10.9% above the close.
Change YTD: 52.03%
Volume: 468,400 shares. 3 month avg: 416,809 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Thursday, and best sell day (most up closes) is Friday.
 
Chart pattern: Dead-cat bounce continuation pattern from 11/03/2017 to 11/03/2017
Breakout is downward 67% of the time.
Average decline: 18%.

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Standex International Corp (SXI)
Industry: Diversified Co.
Industry RS rank: 9 out of 56
Stock RS rank: 195 out of 587
11/9/17 close: $100.70
1 Month avg volatility: $2.56. Volatility stop (for downward breakout): $107.02 or 6.3% above the close.
Change YTD: 14.63%
Volume: 29,300 shares. 3 month avg: 37,946 shares.
This security may be thinly traded (less than 100k shares)!
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Broadening top reversal pattern from 10/13/2017 to 11/09/2017
Breakout is downward 50% of the time.
Average decline: 15%.
Break-even failure rate: 18%.
Pullbacks occur 48% of the time.
Price hits measure rule target 37% of the time.

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Trex Company (TREX)
Industry: Building Materials
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 39 out of 56
Stock RS rank: 7 out of 587
11/9/17 close: $102.49
1 Month avg volatility: $3.08. Volatility stop (for upward breakout): $95.69 or 6.6% below the close.
Change YTD: 59.15%
Volume: 240,900 shares. 3 month avg: 258,245 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Monday.
 
Chart pattern: Pennant continuation pattern from 11/01/2017 to 11/09/2017
Breakout is upward 61% of the time.
Average rise: 25%.
Break-even failure rate: 2%.
Throwbacks occur 47% of the time.
Price hits measure rule target 60% of the time.

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MSCI Malaysia Index (EWM)
Industry: Investment Co. (Foreign)
Industry RS rank: 27 out of 56
Stock RS rank: 400 out of 587
11/9/17 close: $32.22
1 Month avg volatility: $0.17. Volatility stop (for upward breakout): $31.79 or 1.4% below the close.
Change YTD: 14.78%
Volume: 784,600 shares. 3 month avg: 428,597 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Double Bottom, Adam and Adam reversal pattern from 10/25/2017 to 11/03/2017
Breakout is upward 100% of the time.
Average rise: 35%.
Break-even failure rate: 5%.
Throwbacks occur 64% of the time.
Price hits measure rule target 66% of the time.

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PowerShares Dynamic Oil Services (PXJ)
Industry: Oilfield Svcs/Equipment
Industry RS rank: 47 out of 56
Stock RS rank: 480 out of 587
11/9/17 close: $9.79
1 Month avg volatility: $0.16. Volatility stop (for upward breakout): $9.36 or 4.4% below the close.
Change YTD: -23.34%
Volume: 185,400 shares. 3 month avg: 25,669 shares.
This security may be thinly traded (less than 100k shares)!
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Triangle, ascending reversal pattern from 07/19/2017 to 11/09/2017
Breakout is upward 70% of the time.
Average rise: 35%.
Break-even failure rate: 13%.
Throwbacks occur 57% of the time.
Price hits measure rule target 75% of the time.

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SPDR Consumer Staples Select Sector (XLP)
Industry: Household Products
Industry RS rank: 53 out of 56
Stock RS rank: 431 out of 587
11/9/17 close: $53.73
1 Month avg volatility: $0.36. Volatility stop (for upward breakout): $52.74 or 1.8% below the close.
Change YTD: 3.91%
Volume: 10,364,900 shares. 3 month avg: 10,253,722 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Double Bottom, Adam and Adam reversal pattern from 10/30/2017 to 11/07/2017
Breakout is upward 100% of the time.
Average rise: 35%.
Break-even failure rate: 5%.
Throwbacks occur 64% of the time.
Price hits measure rule target 66% of the time.

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Thursday 11/9/17. Intraday Market Direction: Nasdaq

The index climbed by 0.3% or 21.34 points. Since 02/05/1971 the index made 629 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.8% on 346 occasions.
     Average loss was -0.7% on 283 occasions.
Expect the index to close higher 55.0% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 138/245 or 56.3% of the time.
     The prediction of the index closing lower has been right 43/83 or 51.8% of the time.

Since I post this the night before, check how the futures are trading before market open. Large moves can affect the opening direction.

Picture of the Nasdaq composite on the 5 minute scale.

$ $ $

I show a picture of the Nasdaq composite on the 5-minute scale.

The chart shows two example of a chart pattern called an ascending scallop.

I've seen examples of three scallops in a row before a trend change. The scallops tend to get narrower and shorter as price rises. You see the start of that trend here.

By that, I mean scallop B is wider than scallop A. If another scallop appears tomorrow (Thursday), then I would expect it to be narrower than A.

Oddly, I have also seen examples where three consecutive scallops get wider as price rises before a trend change (a downward trend begins). Go figure.

$ $ $

The following table shows where Fibonacci retrace values of the day's high-low range are plus pivot points, calculated on the Nasdaq composite, sorted by value. When several are near each other (small differences), the area might act as support or resistance.

-- Thomas Bulkowski

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© 2017 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  6,398.47    
 Monthly S1  6,593.79  195.33   
 Weekly S2  6,655.81  62.02   
 Monthly Pivot  6,679.47  23.65   
 Weekly S1  6,722.47  43.00   
 Daily S2  6,739.73  17.26   
 Weekly Pivot  6,743.80  4.08   
 Low  6,753.34  9.54   
 Daily S1  6,764.42  11.08   
 Open  6,764.85  0.43   Yes! The Open is close to the Daily S1.
 61.8% Down from Intraday High  6,767.97  3.12   Yes! The 61.8% Down from Intraday High is close to the Open.
 50% Down from Intraday High  6,772.50  4.52   
 38.2% Down from Intraday High  6,777.02  4.52   
 Daily Pivot  6,778.04  1.02   Yes! The Daily Pivot is close to the 38.2% Down from Intraday High.
 Close  6,789.12  11.08   
 High  6,791.65  2.53   Yes! The High is close to the Close.
 Daily R1  6,802.73  11.08   
 Weekly R1  6,810.46  7.72   
 Daily R2  6,816.35  5.89   
 Weekly R2  6,831.79  15.45   
 Monthly R1  6,874.79  43.00   
 Monthly R2  6,960.47  85.67   

Wednesday 11/8/17. A Look At Indicators

Picture of the chart pattern indicator

This is a picture of the chart pattern indicator on the daily scale. The indicator is the line chart below a chart of the S&P 500 composite.

As the chart shows, bearish divergence has been happening for a while now between the up-trending market and the falling CPI line.

The CPI line, though, is neutral.

Picture of the percent down indicators

The red line is the percentage of stocks at least 20% below their 1-year high (plotted upside down). The blue line is the average percentage drop of stocks below their 1-year high (plotted upside down).

Shown as a red line on the above chart...
On Monday, 23% of stocks in my database are in bear market territory (down at least 20% from their 1-year high).
A week ago, it was 24%.
The fewest was 14% on 12/09/2016.
And the most was 30% on 11/08/2016.
Shown as a blue line on the above chart...
The 497 stocks in my database are down an average of 13% from their yearly high.
A week ago, the average was 12%.
The peak was 9% on 12/09/2016.
And the bottom was 16% on 08/21/2017.

The more sensitive of the two lines, the red one, has improved a percentage point over the past week.

The blue line dropped a percentage point. So there's a small divergence between the two lines. I would expect the blue line to follow the red one.

Compare the two charts. Notice how the indicator lines peak in early October and have dropped since. That follows the prediction I've blogged about. However, the index hasn't complied. It's still struggling to rise. I still think there's a change coming. Maybe earnings season, which is hitting some companies hard, will be the catalyst.

-- Thomas Bulkowski

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Tuesday 11/7/17. Intraday Market Direction: Dow

The index climbed by 0.0% or 9.23 points. Since 10/01/1928 the index made 1273 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.6% on 676 occasions.
     Average loss was -0.6% on 597 occasions.
Expect the index to close higher 53.1% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 150/252 or 59.5% of the time.
     The prediction of the index closing lower has been right 32/65 or 49.2% of the time.

Since I post this the night before, check how the futures are trading before market open. Large moves can affect the opening direction.

Picture of the Dow industrials on the 5 minute scale.

$ $ $

I show a picture of the Dow industrials on the 5-minute scale, but this one is only two days long.

I wanted to show a zoom-in of the ascending triangle, shown here highlighted in red.

The index broke out upward and then dropped, closing below the apex but not below the bottom of the triangle. If it were to close below the bottom of the triangle, then that would bust the upward breakout. And that would be bad news.

If it busts the upward breakout, then I would expect a nice decline to follow. If it turns around and resumes the upward move, then the curl would just be an extended throwback.

My guess is the opening minute will determine the day's direction. If it gaps up, then look for a rise. A gap down, then look for a lower close. But that's just a guess. I don't know if it'll work or not.

$ $ $

I started the search for health insurance. Jeepers. None of the companies I checked have my optometrist or family doctor in network. That means I'd be paying about $12,000 (bronze plan, mind you) and getting no value from it. Not even a free annual exam unless I change doctors.

If I were to get sick, the expenses would have to top about $20,000 before the insurance covers 100%. Go out of network, and they don't cover anything. Nice for them.

One solution is to get married to a women who has group insurance. Tie the knot by January 1st and I'd be set. What are the odds of that happening? Probably the same as finding a decent health insurance plan.

I suppose I could marry someone rich (say, $15,000,000 of liquid net worth) and self insure both of us. That would cover about $2 million for each of us if we got cancer. That would leave a tidy sum to pay for jet fuel.

$ $ $

Quick shout out (thanks) to Ronda P. You know why.

$ $ $

The following table shows where Fibonacci retrace values of the day's high-low range are plus pivot points, calculated on the Dow industrials, sorted by value. When several are near each other (small differences), the area might act as support or resistance.

-- Thomas Bulkowski

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© 2017 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  22,032.77    
 Monthly S1  22,790.59  757.83   
 Monthly Pivot  23,173.83  383.23   
 Weekly S2  23,248.59  74.77   
 Weekly S1  23,398.51  149.91   
 Weekly Pivot  23,477.78  79.28   
 Daily S2  23,493.90  16.12   
 Low  23,520.75  26.85   
 Daily S1  23,521.16  0.41   Yes! The Daily S1 is close to the Low.
 Open  23,533.96  12.80   
 61.8% Down from Intraday High  23,541.42  7.46   
 50% Down from Intraday High  23,547.80  6.38   
 Daily Pivot  23,548.01  0.21   Yes! The Daily Pivot is close to the 50% Down from Intraday High.
 Close  23,548.42  0.41   Yes! The Close is close to the Daily Pivot.
 38.2% Down from Intraday High  23,554.19  5.77   
 High  23,574.86  20.67   
 Daily R1  23,575.27  0.41   Yes! The Daily R1 is close to the High.
 Daily R2  23,602.12  26.85   
 Weekly R1  23,627.70  25.58   
 Weekly R2  23,706.97  79.28   
 Monthly R1  23,931.65  224.68   
 Monthly R2  24,314.89  383.23   

Monday 11/6/17. Market Monday: The Week Ahead

My Prediction

Picture of the Dow transports on the daily scale.

I show the Dow transports on the daily scale.

A head-and-shoulders top appears on the chart, shown with LS as the left shoulder, Head (H), and RS as the right shoulder.

The pattern confirms as a valid chart pattern when the index closes below the red line. I use that line, which I drew horizontally from the right armpit, as the confirmation signal.

Others might use the neckline, a line which connects the two armpits. In this case, the index would slide well below the red line before triggering (after a close on the index).

A broadening bottom appears at A. It had an upward breakout.

Will the index drop all the way down to the broadening bottom before finding support? Probably not, but let's stay tuned.

It could be an early-warning signal of a coming bear market.

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A Brief Look Back

Picture of a flower from my garden.

The following is a brief review of how the markets performed over time. The numbers refer to the close-to-close move in the Dow industrials.

Monday: Down 85.45 points.
Tuesday: Up 28.5 points.
Wednesday: Up 57.77 points.
Thursday: Up 81.25 points.
Friday: Up 22.93 points.

For the Week...

The Dow industrials were up 105 points or 0.4%.
The Nasdaq composite was up 63.18 points or 0.9%.
The S&P 500 index was up 6.77 points or 0.3%.

Year to Date...

Dow Industrials
     0.1% down from the high of 23,557.06 on 11/03/2017.
     19.6% up from the low of 19,677.94 on 01/19/2017.
Nasdaq
     0.0% down from the high of 6,765.14 on 11/03/2017.
     25.3% up from the low of 5,397.99 on 01/03/2017.
S&P 500
     0.0% down from the high of 2,588.42 on 11/03/2017.
     15.3% up from the low of 2,245.13 on 01/03/2017.

Options Expiration

No options expire this week.

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Swing and Position Traders: Chart Pattern Indicator

As of 11/03/2017, the CPI had:

7 bearish patterns,
8 bullish patterns,
246 patterns waiting for breakout.
The CPI signal is 53.3%, which is neutral (between 35% and 65%).

The chart pattern indicator is bullish with 2 of 3 full triangles showing (). Additional triangles are a measure of strength with solid triangles meaning a more reliable signal than half triangles.

Swing Traders: Pivot Points

The following is based on an SFO article in December 2004 by John Seekinger, titled, "Take a two-dimensional approach." He offers these tips.

IndexS2S1PivotR1R2
Dow Industrials (^DJI): Daily  23,450  23,495  23,526  23,570  23,601 
Weekly  23,246  23,392  23,475  23,622  23,704 
Monthly  22,030  22,784  23,171  23,926  24,312 
S&P500 (^GSPC): Daily  2,573  2,580  2,584  2,592  2,596 
Weekly  2,559  2,573  2,581  2,595  2,603 
Monthly  2,498  2,543  2,566  2,611  2,634 
Nasdaq (^IXIC): Daily  6,695  6,730  6,748  6,782  6,800 
Weekly  6,648  6,706  6,736  6,794  6,824 
Monthly  6,390  6,577  6,671  6,858  6,952 
  • Seekinger doesn't look at the range of S2 to R2 as support and resistance levels. Rather, he considers them oversold (S) and overbought (R) areas.
  • S2 to R2 range of values across daily, weekly, and monthly periods: If two values are close together then they lend more significance to the area.
  • If the market trends on day 1, the odds rise tremendously that the market will be range bound between daily S1 and daily R1 the next day.
  • In a quiet market when traders are waiting for an important earnings announcement or economic report, look for daily R1 and S1 levels to hold and for the market to return to the daily pivot.
  • A move outside of daily R1 or S1 usually does not mean a breakout.
  • The odds suggest that the entire week's price action will remain between weekly R2 and S2.
  • Avoid going long when the market moves above weekly R2 (it's overbought) and avoid going short when price moves below weekly S2 (oversold).
  • Consider going short at weekly R1 or long at weekly S1 with a profit objective of the weekly pivot.
  • Consider going long at weekly S2 or short at weekly R2 with a profit objective of weekly S1 or R1, respectively.

Here are the formulas:

Pivot point: P = (H + L + C)/3
First resistance level: R1 = (2 * P) - L
First support level: S1 = (2 * P) - H)
Second resistance level: R2 = P + (R1 - S1)
Second support level: S2 = P - (R1 - S1)
H = high price , L=low price, C=closing price

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Consecutive Price Trends

Index Consecutive
Closes So Far 
% Comments 
 Dow industrials (^DJI) 8 weeks up 0.0%   Expect a reversal soon. 
 8 months up 0.0%   Expect a reversal soon. 
 S & P 500 (^GSPC) 8 weeks up 0.0%   Expect a reversal soon. 
 8 months up 0.0%   Expect a reversal soon. 
 Nasdaq composite (^IXIC) 6 weeks up 5.7%   Expect a reversal soon. 
 5 months up 14.1%   Expect a reversal soon. 

How long can an index close higher (or lower) each day? The adjacent table shows how often consecutive up or down closes occur in the indices, based on the most recent trend of closes.

Low percentages suggest the market is overdue to turn (think of it as the likelihood that next week or next month will continue the trend, based on historical performance). Values of 50% mean random, so most percentages will be lower.

The analysis uses data going back 10 years for weekly percentages and 25 years for monthly percentages (or the start of data, whichever is more recent). Any unchanged closing price is interpreted as the end of the string of consecutive up or down closes.

Earnings, Chart Patterns & Industries

Earnings season is either underway or should be starting soon. The sessions could be more volatile.

Mutual funds will begin dividend distributions and rebalancing their portfolios for the approaching year end (starts in late November).

 Found Chart Pattern Name
16Triangle, symmetrical
11Double Top, Adam and Adam
10Head-and-shoulders top
10Pipe bottom
9Dead-cat bounce
6Rising wedge
5Double Top, Adam and Eve
5Double Top, Eve and Adam
4Triple top
4Flag

Large numbers of bullish or bearish chart patterns can signal short- to intermediate-term market trends (many bullish chart patterns can mean an uptrend will continue, for example). However, please realize that the short-term price trend could have changed since the pattern was discovered (this is especially true of pipe tops or bottoms, which are weekly patterns).

The 10 types of most frequently appearing chart patterns in the stocks, indices, and long-only exchange traded funds I follow during the last month are shown in the adjacent table.

 

 

 

 

The industries I follow were the best (rank 1) and worst performing.

This WeekLast Week
1. Semiconductor1. Semiconductor
2. Trucking/Transp. Leasing2. Computer Software and Svcs
3. Computer Software and Svcs3. Semiconductor Cap Equip.
4. Semiconductor Cap Equip.4. Homebuilding
5. Homebuilding5. Trucking/Transp. Leasing
50. Food Processing50. Chemical (Specialty)
51. Cement and Aggregates51. Retail Store
52. Retail Store52. Food Processing
53. Drug53. Household Products
54. Furn/Home Furnishings54. Petroleum (Producing)
55. Household Products55. Short ETFs
56. Advertising56. Oilfield Svcs/Equipment
57. Short ETFs57. Advertising

-- Thomas Bulkowski

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Friday 11/3/17. Pattern Trading Setups for the Weekend.

Go to Table.

You can find setups based on a Fibonacci retrace by clicking on the link.

Click the link for a list of symbols from the table.

The following patterns were found manually, so the results may differ from those found using Patternz.

There were 18 patterns found this week (excluding pipe bottoms; pipe tops and bottoms are found looking back 2 weeks) out of 595 stocks searched, or 3.0%. Based on the percentage, the stock market is trending since few consolidation patterns appear.

I found 1 pipe bottom chart patterns, which is neutral. High numbers of pipe bottoms can signal a bullish move (I see many of them just before a bear market ends or during a bear market rally. Often it means the first bottom of a double bottom has formed. Thus, expect a move down to the second bottom).

Excluding ETFs, there were 4 bullish chart patterns this week and 9 bearish ones with any remaining (5) being undecided. The ratio of bullish to bearish patterns suggests the market is hinting of a coming bearish (down) turn.

In the table below, the red and green colors are based on the historical breakout direction for the associated chart pattern. If a high and tight flag appears, the start and end dates highlight the flagpole only and not the flag.

More...

-- Thomas Bulkowski

 

Symbol Chart Pattern Bullish
Bearish
Start End Industry
DDDDead-cat bounce      11/01/201711/01/2017Electronics
CAGTriangle, symmetrical      09/15/201711/02/2017Food Processing
EFIIDead-cat bounce      10/27/201710/27/2017Computers and Peripherals
EFXTriangle, symmetrical      10/11/201711/02/2017Information Services
ERAPipe bottom      10/16/201710/23/2017Air Transport
REDouble Top, Adam and Adam      10/13/201710/31/2017Insurance (Prop/Casualty)
FEYEHead-and-shoulders top      09/18/201710/31/2017Computer Software and Svcs
FISVDouble Top, Eve and Adam      10/02/201710/27/2017IT Services
FLIRFlag      10/26/201711/02/2017Aerospace/Defense
ICONDead-cat bounce      10/30/201710/30/2017Shoe
JCPDead-cat bounce      10/27/201710/27/2017Retail Store
NWLDead-cat bounce      11/02/201711/02/2017Household Products
NUSDouble Top, Eve and Adam      10/16/201711/01/2017Toiletries/Cosmetics
OXMRising wedge      09/06/201710/30/2017Apparel
PDCOPipe top      10/16/201710/23/2017Medical Supplies
PPLTriangle, symmetrical      10/06/201710/31/2017Electric Utility (East)
TEVADead-cat bounce      11/02/201711/02/2017Drug
VFCFlag      10/24/201710/31/2017Apparel
ECHScallop, ascending and inverted      09/27/201710/27/2017Investment Co. (Foreign)

 

Weekly screen for chart patterns ending between 10/26/2017 and 11/02/2017. Many may be still in development. If no securities appear, then I have not identified any new patterns.

Definitions
RS is relative strength (where 1 is best). For other definitions, see the glossary.
’Breakout is upward/downward 100% of the time’ means price breaks out up/down by definition, not by statistically measuring the rate.
All numbers assume a bull market and are based on the breakout direction that occurs most often.
For more information, consult my book, Encyclopedia of Chart Patterns, Second Edition.
 
3D Systems (DDD)
Industry: Electronics
Industry RS rank: 12 out of 56
Stock RS rank: 580 out of 587
11/2/17 close: $9.09
1 Month avg volatility: $0.56. Volatility stop (for downward breakout): $10.56 or 16.2% above the close.
Change YTD: -31.60%
Volume: 5,782,100 shares. 3 month avg: 2,715,718 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Thursday, and best sell day (most up closes) is Monday.
 
Chart pattern: Dead-cat bounce continuation pattern from 11/01/2017 to 11/01/2017
Breakout is downward 67% of the time.
Average decline: 18%.

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ConAgra Brands Inc (CAG)
Industry: Food Processing
Industry RS rank: 46 out of 56
Stock RS rank: 494 out of 587
11/2/17 close: $33.86
1 Month avg volatility: $0.51. Volatility stop (for upward breakout): $32.68 or 3.5% below the close.
Change YTD: -14.39%
Volume: 2,481,000 shares. 3 month avg: 3,675,502 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Triangle, symmetrical continuation pattern from 09/15/2017 to 11/02/2017
Breakout is upward 54% of the time.
Average rise: 31%.
Break-even failure rate: 9%.
Throwbacks occur 37% of the time.
Price hits measure rule target 66% of the time.

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Electronics For Imaging, Inc. (EFII)
Industry: Computers and Peripherals
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 28 out of 56
Stock RS rank: 571 out of 587
11/2/17 close: $31.06
1 Month avg volatility: $1.25. Volatility stop (for downward breakout): $33.81 or 8.9% above the close.
Change YTD: -29.18%
Volume: 1,082,200 shares. 3 month avg: 1,274,698 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Tuesday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Dead-cat bounce continuation pattern from 10/27/2017 to 10/27/2017
Breakout is downward 67% of the time.
Average decline: 18%.

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Equifax Inc (EFX)
Industry: Information Services
Industry RS rank: 44 out of 56
Stock RS rank: 542 out of 587
11/2/17 close: $108.92
1 Month avg volatility: $2.37. Volatility stop (for upward breakout): $102.89 or 5.5% below the close.
Change YTD: -7.87%
Volume: 1,240,000 shares. 3 month avg: 3,805,246 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Triangle, symmetrical continuation pattern from 10/11/2017 to 11/02/2017
Breakout is upward 54% of the time.
Average rise: 31%.
Break-even failure rate: 9%.
Throwbacks occur 37% of the time.
Price hits measure rule target 66% of the time.

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Era Group Inc (ERA)
Industry: Air Transport
Industry RS rank: 41 out of 56
Stock RS rank: 499 out of 587
11/2/17 close: $10.75
1 Month avg volatility: $0.41. Volatility stop (for upward breakout): $9.75 or 9.3% below the close.
Change YTD: -36.65%
Volume: 58,600 shares. 3 month avg: 59,686 shares.
This security may be thinly traded (less than 100k shares)!
Since 2009 bear market, the best buy day (fewest up closes) is Thursday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Pipe bottom reversal pattern from 10/16/2017 to 10/23/2017
Breakout is upward 100% of the time.
Average rise: 45%.
Break-even failure rate: 5%.
Throwbacks occur 44% of the time.
Price hits measure rule target 83% of the time.

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Everest Re Group Ltd (RE)
Industry: Insurance (Prop/Casualty)
Industry RS rank: 40 out of 56
Stock RS rank: 486 out of 587
11/2/17 close: $227.44
1 Month avg volatility: $4.98. Volatility stop (for downward breakout): $247.20 or 8.7% above the close.
Change YTD: 5.10%
Volume: 692,600 shares. 3 month avg: 522,202 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Double Top, Adam and Adam reversal pattern from 10/13/2017 to 10/31/2017
Breakout is downward 100% of the time.
Average decline: 19%.
Break-even failure rate: 8%.
Pullbacks occur 61% of the time.
Price hits measure rule target 72% of the time.

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FireEye Inc (FEYE)
Industry: Computer Software and Svcs
Industry RS rank: 4 out of 56
Stock RS rank: 321 out of 587
11/2/17 close: $14.68
1 Month avg volatility: $0.40. Volatility stop (for downward breakout): $15.97 or 8.8% above the close.
Change YTD: 23.36%
Volume: 17,150,700 shares. 3 month avg: 4,784,169 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Thursday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Head-and-shoulders top reversal pattern from 09/18/2017 to 10/31/2017
Breakout is downward 100% of the time.
Average decline: 22%.
Break-even failure rate: 4%.
Pullbacks occur 50% of the time.
Price hits measure rule target 55% of the time.

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Fiserv, Inc (FISV)
Industry: IT Services
Industry RS rank: 13 out of 56
Stock RS rank: 313 out of 587
11/2/17 close: $126.58
1 Month avg volatility: $1.41. Volatility stop (for downward breakout): $130.00 or 2.7% above the close.
Change YTD: 19.10%
Volume: 1,550,800 shares. 3 month avg: 869,394 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Wednesday.
 
Chart pattern: Double Top, Eve and Adam reversal pattern from 10/02/2017 to 10/27/2017
Breakout is downward 100% of the time.
Average decline: 15%.
Break-even failure rate: 13%.
Pullbacks occur 64% of the time.
Price hits measure rule target 72% of the time.

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Flir Systems Inc (FLIR)
Industry: Aerospace/Defense
Industry RS rank: 6 out of 56
Stock RS rank: 75 out of 587
11/2/17 close: $46.72
1 Month avg volatility: $0.72. Volatility stop (for upward breakout): $44.83 or 4.0% below the close.
Change YTD: 29.10%
Volume: 1,325,200 shares. 3 month avg: 1,127,663 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Flag continuation pattern from 10/26/2017 to 11/02/2017
Breakout is upward 54% of the time.
Average rise: 23%.
Break-even failure rate: 4%.
Throwbacks occur 43% of the time.
Price hits measure rule target 64% of the time.

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Iconix Brand Group Inc. (ICON)
Industry: Shoe
Industry RS rank: 29 out of 56
Stock RS rank: 587 out of 587
11/2/17 close: $1.66
1 Month avg volatility: $0.35. Volatility stop (for downward breakout): $2.71 or 63.3% above the close.
Change YTD: -82.23%
Volume: 4,880,100 shares. 3 month avg: 1,185,222 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Monday.
 
Chart pattern: Dead-cat bounce continuation pattern from 10/30/2017 to 10/30/2017
Breakout is downward 67% of the time.
Average decline: 18%.

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JC Penney Company Inc (JCP)
Industry: Retail Store
Industry RS rank: 49 out of 56
Stock RS rank: 584 out of 587
11/2/17 close: $2.55
1 Month avg volatility: $0.16. Volatility stop (for downward breakout): $3.02 or 18.6% above the close.
Change YTD: -69.31%
Volume: 31,513,800 shares. 3 month avg: 18,747,972 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Friday.
 
Chart pattern: Dead-cat bounce continuation pattern from 10/27/2017 to 10/27/2017
Breakout is downward 67% of the time.
Average decline: 18%.

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Newell Rubbermaid Inc (NWL)
Industry: Household Products
Industry RS rank: 53 out of 56
Stock RS rank: 572 out of 587
11/2/17 close: $30.01
1 Month avg volatility: $0.83. Volatility stop (for downward breakout): $34.85 or 16.1% above the close.
Change YTD: -32.79%
Volume: 47,502,400 shares. 3 month avg: 5,681,065 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Tuesday, and best sell day (most up closes) is Friday.
 
Chart pattern: Dead-cat bounce continuation pattern from 11/02/2017 to 11/02/2017
Breakout is downward 67% of the time.
Average decline: 18%.

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Nu Skin Enterprises, Inc (NUS)
Industry: Toiletries/Cosmetics
Industry RS rank: 21 out of 56
Stock RS rank: 273 out of 587
11/2/17 close: $60.86
1 Month avg volatility: $1.28. Volatility stop (for downward breakout): $65.44 or 7.5% above the close.
Change YTD: 27.38%
Volume: 943,200 shares. 3 month avg: 620,995 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Thursday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Double Top, Eve and Adam reversal pattern from 10/16/2017 to 11/01/2017
Breakout is downward 100% of the time.
Average decline: 15%.
Break-even failure rate: 13%.
Pullbacks occur 64% of the time.
Price hits measure rule target 72% of the time.

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Oxford Industries (OXM)
Industry: Apparel
Industry RS rank: 36 out of 56
Stock RS rank: 237 out of 587
11/2/17 close: $63.59
1 Month avg volatility: $1.34. Volatility stop (for downward breakout): $67.51 or 6.2% above the close.
Change YTD: 5.75%
Volume: 78,700 shares. 3 month avg: 155,811 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Tuesday.
 
Chart pattern: Rising wedge reversal pattern from 09/06/2017 to 10/30/2017
Breakout is downward 69% of the time.
Average decline: 14%.
Break-even failure rate: 24%.
Pullbacks occur 63% of the time.
Price hits measure rule target 46% of the time.

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Patterson Companies Inc. (PDCO)
Industry: Medical Supplies
Industry RS rank: 33 out of 56
Stock RS rank: 540 out of 587
11/2/17 close: $35.97
1 Month avg volatility: $0.80. Volatility stop (for downward breakout): $37.83 or 5.2% above the close.
Change YTD: -12.33%
Volume: 1,047,900 shares. 3 month avg: 1,454,029 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Pipe top reversal pattern from 10/16/2017 to 10/23/2017
Breakout is downward 100% of the time.
Average decline: 20%.
Break-even failure rate: 11%.
Pullbacks occur 41% of the time.
Price hits measure rule target 70% of the time.

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PPL Corporation (PPL)
Industry: Electric Utility (East)
Industry RS rank: 26 out of 56
Stock RS rank: 443 out of 587
11/2/17 close: $36.90
1 Month avg volatility: $0.47. Volatility stop (for upward breakout): $35.77 or 3.1% below the close.
Change YTD: 8.37%
Volume: 3,864,000 shares. 3 month avg: 2,968,689 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Triangle, symmetrical continuation pattern from 10/06/2017 to 10/31/2017
Breakout is upward 54% of the time.
Average rise: 31%.
Break-even failure rate: 9%.
Throwbacks occur 37% of the time.
Price hits measure rule target 66% of the time.

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Teva Pharmaceutical Industries (TEVA)
Industry: Drug
WARNING: This industry is within the top 7 that Dead-cat bounce often.
Industry RS rank: 51 out of 56
Stock RS rank: 586 out of 587
11/2/17 close: $11.23
1 Month avg volatility: $0.57. Volatility stop (for downward breakout): $13.38 or 19.1% above the close.
Change YTD: -69.02%
Volume: 117,278,400 shares. 3 month avg: 28,018,565 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Friday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Dead-cat bounce continuation pattern from 11/02/2017 to 11/02/2017
Breakout is downward 67% of the time.
Average decline: 18%.

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V. F. Corp (VFC)
Industry: Apparel
Industry RS rank: 36 out of 56
Stock RS rank: 49 out of 587
11/2/17 close: $69.91
1 Month avg volatility: $1.10. Volatility stop (for upward breakout): $67.11 or 4.0% below the close.
Change YTD: 31.04%
Volume: 2,185,000 shares. 3 month avg: 2,289,871 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Wednesday, and best sell day (most up closes) is Monday.
 
Chart pattern: Flag continuation pattern from 10/24/2017 to 10/31/2017
Breakout is upward 54% of the time.
Average rise: 23%.
Break-even failure rate: 4%.
Throwbacks occur 43% of the time.
Price hits measure rule target 64% of the time.

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MSCI Chile Investable Mkt Idx (ECH)
Industry: Investment Co. (Foreign)
Industry RS rank: 22 out of 56
Stock RS rank: 132 out of 587
11/2/17 close: $51.44
1 Month avg volatility: $0.48. Volatility stop (for upward breakout): $49.80 or 3.2% below the close.
Change YTD: 37.47%
Volume: 421,800 shares. 3 month avg: 334,346 shares.
Since 2009 bear market, the best buy day (fewest up closes) is Monday, and best sell day (most up closes) is Thursday.
 
Chart pattern: Scallop, ascending and inverted continuation pattern from 09/27/2017 to 10/27/2017
Breakout is upward 100% of the time.
Average rise: 43%.
Break-even failure rate: 4%.
Throwbacks occur 61% of the time.
Price hits measure rule target 61% of the time.

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Thursday 11/2/17. Intraday Market Direction: Nasdaq

The index dropped by -0.2% or -11.14 points. Since 02/05/1971 the index made 485 similar moves on a percentage basis. After those moves, the next day's...
     Average gain was 0.7% on 252 occasions.
     Average loss was -0.8% on 233 occasions.
Expect the index to close higher 52.0% of the time.
Weekly, since inception on 6/14/2011:
     The prediction of the index closing higher has been right 138/244 or 56.6% of the time.
     The prediction of the index closing lower has been right 43/83 or 51.8% of the time.

Since I post this the night before, check how the futures are trading before market open. Large moves can affect the opening direction.

Picture of the Nasdaq composite on the 5 minute scale.

$ $ $

I show a picture of the Nasdaq composite on the 5-minute scale.

The only interesting thing I see in the chart on the right is the support area, highlighted by the red line.

I think it begins in the circled area, a congestion region where bulls and bears fought for direction. The bulls won, and the index climbed.

On Wednesday, the bears fought back and pushed the index down to touch the red line before the bulls woke up and took over. I can see the index rounding over and heading lower on Thursday, but that's just a guess.

$ $ $

The following table shows where Fibonacci retrace values of the day's high-low range are plus pivot points, calculated on the Nasdaq composite, sorted by value. When several are near each other (small differences), the area might act as support or resistance.

-- Thomas Bulkowski

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© 2017 ThePatternSite.com    Metric  Value  Diff  Close (within 10% of the high-low range for the day)? 
 Monthly S2  6,225.37    
 Weekly S2  6,457.33  231.96   
 Monthly S1  6,470.95  13.62   
 Weekly S1  6,586.93  115.98   
 Monthly Pivot  6,589.54  2.61   Yes! The Monthly Pivot is close to the Weekly S1.
 Weekly Pivot  6,647.53  57.99   
 Daily S2  6,654.38  6.85   
 Daily S1  6,685.45  31.08   
 Low  6,691.48  6.03   Yes! The Low is close to the Daily S1.
 Close  6,716.53  25.05   
 61.8% Down from Intraday High  6,717.52  1.00   Yes! The 61.8% Down from Intraday High is close to the Close.
 Daily Pivot  6,722.56  5.03   Yes! The Daily Pivot is close to the 61.8% Down from Intraday High.
 50% Down from Intraday High  6,725.57  3.01   Yes! The 50% Down from Intraday High is close to the Daily Pivot.
 38.2% Down from Intraday High  6,733.62  8.05   
 Daily R1  6,753.63  20.02   
 Open  6,758.64  5.01   Yes! The Open is close to the Daily R1.
 High  6,759.66  1.02   Yes! The High is close to the Open.
 Weekly R1  6,777.13  17.47   
 Daily R2  6,790.74  13.61   
 Monthly R1  6,835.12  44.38   
 Weekly R2  6,837.73  2.61   Yes! The Weekly R2 is close to the Monthly R1.
 Monthly R2  6,953.71  115.98   

Wednesday 11/1/17. A Look At Indicators

Picture of the chart pattern indicator

This is a picture of the chart pattern indicator on the daily scale. The indicator is the line chart below a chart of the S&P 500 composite.

The chart shows another wave of divergence. We've seen this before but the index continues higher.

The last green vertical bar on the right means the indicator is still bullish, even though it flipped to bearish yesterday for a time. (Signals can change for up to a week).

Picture of the percent down indicators

The red line is the percentage of stocks at least 20% below their 1-year high (plotted upside down). The blue line is the average percentage drop of stocks below their 1-year high (plotted upside down).

Shown as a red line on the above chart...
On Monday, 24% of stocks in my database are in bear market territory (down at least 20% from their 1-year high).
A week ago, it was 21%.
The fewest was 14% on 12/09/2016.
And the most was 36% on 11/03/2016.
Shown as a blue line on the above chart...
The 497 stocks in my database are down an average of 12% from their yearly high.
A week ago, the average was 11%.
The peak was 9% on 12/09/2016.
And the bottom was 18% on 11/03/2016.

Both lines took a dive this period. The red line, which is the more sensitive of the two, dropped from 21% bearish to 24% of the stocks in my database.

The average stock is down 12% from their yearly high, dropping a percentage point. Both of these events are bearish but it might not mean anything of the indices continue higher.

And yet I remain nervous. My fingers are on the sell trigger, but I haven't pulled it much so far.

$ $ $

I released updated versions of broadening tops and bottoms, including some new performance statistics (performance over decades).

-- Thomas Bulkowski

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